GBPUSD Elliot Waves Analysis For 6 January 2016

06 January 2016, GBP/USD

Wave Analysis:

GBP/USD is currently trading with slight bearish bias. Wave (5) went much lower crossed and even closed below the lower green trend line. We expect 1.4637 to be the end of wave (5). we are currently looking for a beginning of a 3 wave cycle with wave (c) ending above 1.4814, thus, we will look to buy above 1.4678 with targets above 1.4814. Any clear move below 1.4553 will call for further short positions with targets below 1.4251. This pair should be traded alongside other pairs such as GBP/HKD, GBP/JPY and EUR/JPY. These pairs have a strong positive correlation of up to +0.96 and are thus expected to have a similar chart pattern. Only buy or sell cable if all the other positively correlated pairs are giving the same signal.

Trade Recommendation:

Buy above 1.4678 with a target at 1.4814, sell below 1.4553 with a target at 1.4251